The firm says the growth is particularly notable as it excludes contributions from the company’s Systems Integration division, which was sold in December. The result reflects Gloster’s strategic transition toward high-value, recurring revenue projects within the cloud services and software development sectors.
Since 2021, Gloster’s order backlog has demonstrated an average annual growth rate (CAGR) of 92%, highlighting the company’s ability to sustain momentum despite significant operational changes. The open backlog metric includes all contracted but not yet fulfilled projects across Gloster’s subsidiaries.
The firm says a shift to focus on cloud-based services has been a pivotal driver of its sustained growth. Its merger of Gloster Cloud Zrt. and Systemfarmer Zrt. created Hungary’s largest domestically owned Microsoft cloud service provider. The growing European public cloud market is valued at up to USD 160 billion, with Microsoft Azure holding a 22-24% market share.
The cloud division’s recurring revenue, which accounts for more than 80% of its total income, provides the company with a stable and predictable financial foundation. The increasing adoption of artificial intelligence technologies reinforces this. Gloster’s integration of Microsoft AI platforms has proven instrumental in meeting the evolving needs of its clients, particularly as more businesses turn to AI-driven solutions to enhance efficiency and innovation.
Business Cornerstone
Beyond its cloud services, Gloster’s international software development operations remain a cornerstone of its business model. Critical contracts with significant clients have ensured consistent revenue streams for the first half of 2025, with additional orders anticipated as the year progresses.
While some smaller projects experienced minor slowdowns, Gloster insists it has cultivated relationships with new clients, leading to promising opportunities for growth. The company’s international sales teams have played a crucial role in securing high-value projects and expanding Gloster’s global reach.
The company’s robust performance has earned the confidence of financial analysts. Erste Group, a leading independent investment service provider, has maintained a “Buy” recommendation for Gloster, with a 12 month price target of HUF 1,183.
Moving into 2025, Gloster believes it is well-positioned to build on its recent successes. The company anticipates further growth in its cloud and software development divisions, driven by robust recurring revenues and a steady pipeline of new projects.
This article was first published in the Budapest Business Journal print issue of January 24, 2025.
